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Before the
Federal Communications Commission
Washington, D.C. 20554
)
In the Matter of )
)
U S WEST Communications, Inc. )
Petition for Limited Modification of LATA )
Boundary to Provide Expanded Local ) File No. NSD-L-00-69
Calling Service (ELCS) )
MEMORANDUM OPINION AND ORDER
Adopted: August 2, 2000 Released: August 3, 2000
By the Chief, Network Services Division, Common Carrier Bureau:
I. INTRODUCTION
1. On March 10, 2000, U S WEST Communications, Inc.( U S WEST), pursuant to Section
3(25) of the Communications Act of 1934, as amended, filed a petition to provide two-way, flat-rated,
non-optional, expanded local calling service (ELCS) between the Jefferson exchange located in the
Eugene LATA and the Salem exchange located in the Portland LATA, in Oregon. U S WEST's petition
requests limited modifications of local access and transport area (LATA) boundaries. The petition was
placed on public notice, and no comments were filed. For the reasons stated below, we grant U S
WEST's request.
II.BACKGROUND
2. Requests for new ELCS routes are generally initiated by local subscribers. IntraLATA
ELCS routes can be ordered by the state commission. For interLATA routes, prior to the
Telecommunications Act of 1996 (1996 Act), the Bell Operating Companies (BOCs) were required to
secure state approval and then obtain a waiver from the United States District Court for the District of
Columbia (District Court). In the years between the Consent Decree and the 1996 Act, the District
Court received more than a hundred requests for Consent Decree waivers to permit new interLATA
ELCS routes. Because of the large number of requests involved and because most of the requests were
non-controversial, the District Court developed a streamlined process for handling such requests.
3. Under the streamlined process developed by the District Court, the BOC submitted its waiver
request to the Department of Justice (Department). The Department reviewed the request and then
submitted the request, along with the Department's recommendation, to the District Court. In evaluating
ELCS requests, the Department and the District Court considered the number of customers or access
lines involved as well as whether a sufficiently strong community of interest between the exchanges
justified granting a waiver of the Consent Decree. A community of interest could be demonstrated by
such evidence as: (1) poll results showing that customers in the affected exchange were willing to pay
higher rates to be included in an expanded local calling area; (2) usage data demonstrating a high level
of calling between the exchanges; and (3) narrative statements describing how the two exchanges were
part of one community and how the lack of
local calling between the exchanges caused problems for community residents. In addition, the
Department and the District Court gave deference to the state's community of interest finding. The
District Court also considered the competitive effects of granting a proposed ELCS waiver.
4. Matters previously subject to the Consent Decree are now governed by the Act. Under
section 3(25)(B) of the Act, the Commission may approve BOC requests to modify LATA boundaries.
On July 15, 1997, the Commission released a decision granting 23 requests for limited boundary
modification to permit ELCS. Although calls between the ELCS exchanges would now be treated as
intraLATA, each ELCS exchange would remain assigned to the same LATA for purposes of classifying
all other calls. The Commission stated that it would grant requests for such limited modifications only
where a petitioning BOC showed that the ELCS was a traditional, non-optional service, a significant
community of interest existed among the affected exchanges, and grant of the requested waiver would
not have any anticompetitive effects. The Commission stated further that a carrier would be deemed
to have made a prima facie case supporting grant of the proposed modification if the ELCS petition: (1)
has been approved by the state commission; (2) proposes only traditional local service (i.e., traditional,
non-optional ELCS); (3) indicates that the state commission found a sufficient community of interest to
warrant such service; (4) documents this community of interest through such evidence as poll results,
usage data,
and descriptions of the communities involved; and (5) involves a limited number of customers or
access lines.
III. DISCUSSION
5. The petition proposes to establish, two-way, flat-rated, non-optional ELCS, and
is accompanied by: (1) a statement that only two-way, flat-rated, non-optional is proposed;
(2) an order issued by the the Public Utilities Commission of Oregon (PUC) indicating that
the commission found a sufficient community of interest to warrant such service; (3)
subscriber polls; (4) a statement of the number of access lines involved; and (5) a
statement that the average number of toll calls per line per month from Jefferson exchange
customers to the Salem exchange was 14.68. The brief descriptions of the community of
interest reveal that the interLATA EAS route is necessary to meet the critical needs of
Jefferson exchange customers who depend heavily on the Salem exchange for emergency,
dental, medical, professional, business, educational, and governmental services. The
Oregon PUC held a hearing in Jefferson to allow petitioners to make a showing of critical
needs. Approximately 100 people attended the hearing. The Oregon PUC concluded that
the interLATA EAS route is necessary to meet the critical needs of customers in the
Jefferson exchange.
6. As we noted in the July 1997 Order, granting an ELCS petition removes the proposed route
from the competitive interexchange market, and some LATA modifications could reduce the BOCs'
incentive to open their own markets to competition pursuant to section 271 of the Act. Given the small
number of access lines and the small volume of traffic involved for the proposed ELCS areas in this
petition, as well as the types of service to be offered (e.g., flat-rated, non-optional local service), it is
highly unlikely that provision of ELCS service would reduce U S WEST's motivation to open its own
market to competition. Because of the limited amount of traffic and the type of service involved, the
Division finds that the proposed LATA modification will not have a significant anticompetitive effect
on the interexchange market or on U S WEST's incentive to open its own market to competition. We
conclude that the information in the petition satisfies the criteria established in the July 1997 Order.
6. We conclude that, in this request, the need for the proposed ELCS route
outweighs the risk of potential anticompetitive effects. Granting U S WEST's petition
serves the public
interest by permitting a minor LATA modification where such modification is necessary to meet the
needs of local subscribers and will not have any significant effect on competition. Accordingly, we
approve U S WEST's petition for limited LATA modification in order to provide two-way, flat-rated,
non-optional ELCS. The LATA is modified solely for the limited purpose of allowing U S WEST to
provide two-way, flat-rated, non-optional local calling service between the specific exchanges or
geographic areas identified in the requests. The LATA is not modified to permit the BOC to offer any
other type of service, including calls that originate or terminate outside the specified areas. Thus, two-
way, flat-rated, non-optional ELCS between the specified exchanges will be treated as intraLATA, and
the provisions of the Act governing intraLATA service will apply. Other types of service between the
specified exchanges will remain interLATA, and the provisions of the Act governing interLATA service
will apply.
VI. CONCLUSION AND ORDERING CLAUSES
8. Accordingly, IT IS ORDERED, pursuant to sections 3(25) and 4(i) of the Communications
Act of 1934, as amended, 47 U.S.C. 153(25), 154(i), and authority delegated by Sections 0.91 and
0.291 of the Commission's rules, 47 C.F.R. 0.91, 0.291, that the request of U S WEST for LATA
modification for the limited purpose of providing two-way, flat-rated, non-optional ELCS at the specific
location, identified in File No. NSD-L-00-69, IS APPROVED. This LATA boundary is modified solely
for the purpose of providing two-way, flat-rated, non-optional ELCS between points in the specific
exchanges or geographic areas indicated in the request. The LATA boundary for all other services shall
remain unchanged.
9. IT IS FURTHER ORDERED that pursuant to section 416(a) of the Act, 47 U.S.C. 416(a),
the Secretary SHALL SERVE a copy of this order upon the petitioner, U S WEST.
FEDERAL COMMUNICATIONS COMMISSION
L. Charles Keller
Chief, Network Services Division
Common Carrier Bureau